Beware collective amnesia over light regulation

The dust hasn’t even settled yet on our economic collapse, singularly caused by the financial and banking system with the support of a complicit government.

Yet it has not stopped our financial services sector, their cheerleaders and fellow travellers from insisting that we need to get back to a lighter regulatory environment, else we may lose some of these companies.

In essence they are asking us to trust them. But events across the world would suggest that corporates have little responsibility to the community at large, so why should we? These companies are profit takers and their major, perhaps even sole responsibility, is to their shareholders.

According to the Financial Times lexicon: “Corporate responsibility includes being consistent with ethical principles and conduct such as honesty, integrity and respect for others. By voluntarily accepting responsibility for its actions corporations earn their license to operate in society.”

If that is an accurate definition of corporate responsibility then BP, based on the excellent article in last Saturday’s Irish Examiner, by Mark Hertsgaard, entitled ‘The things BP doesn’t want you to know about the Gulf of Mexico oil spill’ suggest that BP is a very long way away from meeting the goals outlined.

On Apr 20, 2010, an explosion occurred on the Deepwater Horizon Oil Rig, which was on contract to BP, in the Gulf of Mexico, killing 11 workers and injuring 17. When its blow out preventer failed it pumped around 210m gallons of crude oil into the Gulf destroying the environment and the health and livelihood of tens of thousands of individuals. Bad as that is, what is worse is the apparent large-scale cover-up that followed, in a bid to minimise the financial impact on the corporation.

BP has already been fined $4.5bn (€3.4bn) as part of a legal settlement with the Justice Department. It appears to have denied having knowledge of the potential human health impact consequences of the dispersant that it used despite apparent evidence to the contrary. If gross negligence is proven, it is possible it may be fined a further $17.5bn in the trial on now in New Orleans, and possibly another $34bn when local states’ demands are taken into account.

BP is not unique. Why should we trust any corporate unless they have proven that they can be trusted? In Ireland and the UK hydraulic fracturing or fracking is becoming a major issue. The pressure is on to find natural resources and, given our current economic predicament, there will be a lot of cognitive dissonance as the need for revenue will take centre stage. In an article in New Civil Engineer last November the columnist reported that a global gas developer had insisted that the risks associated with shale gas drilling have been overstated because they did not take into account mitigation efforts.

However, whole areas have been devastated in the US with ground waters contaminated — apparently caused by fracking. The fact that courts find it difficult to show a direct link between the problems and fracking only exacerbates the problem for those of us who will have to suffer the results.

For years cigarette manufacturers told us cigarettes had no negative impact. We now know that not only was this untrue but the manufacturers knew that it was. Right now corporations with considerable lobby power are working their “magic” — or their dollars — on US legislators to reduce demands for comprehensive labelling on genetically modified foodstuffs.

In Ireland we only have to think about the banks, the impact of light regulation, the massive bailouts and the continuing arrogance to understand that corporates are there to make money — first, last and always. Everything else is but a necessary evil to be minimised at all costs. Let’s not all suffer from collective amnesia.

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